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Marketers stress measurement

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B-to-b marketers last month debated how to measure the effectiveness of their efforts at the first in a series of marketing performance management conferences produced by the CMO Council.

The inaugural MPM Forum, held March 23 in Sunnyvale, Calif., was attended by more than 200 marketers, primarily in high-tech industries. Additional MPM Forums will be held this year in Boston, Chicago, London, Los Angeles, Munich, New York and Paris.

"We have to get senior management buy-in into the process of measuring marketing," said Donovan Neale-May, executive director of the CMO Council.

"MPM is not just campaign measurement or metrics around how many people are hitting your Web site. We are taking it to a much higher level," he said. "When you look at marketing, you have to look at strategic areas of marketing and how they impact the value and performance of the company."

Presenters at the forum discussed MPM strategies at their own companies and debated industry issues.

"Whether you call it marketing performance management or ROI, we as marketers need to show that our stuff is working," said Guy Powell, principal of marketing ROI consultancy demandG, the keynote speaker at the event.

Sell numbers to the C-suite

"When we want to sell [ideas] to our bosses in the C-suite, we need to speak numbers they understand, such as how much revenue did marketing generate, lift in awareness, etc."

Powell said b-to-b marketers are "woefully behind" their consumer counterparts when it comes to investing in the data necessary for effective marketing measurement. "If you want to do a really great job at providing metrics, you have to spend money on data," he said.

Large consumer packaged goods companies spend about 0.33% of their total revenue on data collection, which is roughly $3.3 million per $1 billion in revenue, Powell said.

"B-to-b companies," he said, "are spending 1/10th to 1/100th of that in most cases. One of their excuses is they don't have the data, but that is because they are not spending the money to get the data."

Nicholas de Kouchkovsky, senior VP-marketing and business development at Genesis Telecommunications Laboratories, said his organization recently developed an MPM process.

"At the CEO level, there was a real concern to make sure there was alignment of marketing activities with the strategic initiatives of the company," he said.

"There was also very strong interest from the finance organization to understand ROI on all marketing programs. As we were growing, we wanted to make sure we were not spreading our investment activity across too many different areas."

Genesis developed metrics that measure the business performance of the company, including revenue per employee, number of new customers, customer satisfaction and revenue closed on a quarterly basis.

De Kouchkovsky said Genesis is now trying to define market awareness and mindshare metrics. "These metrics are more challenging," he said. "Often there is no immediate link between the activities and what you get."

Timothy Eades, senior VP-marketing at Sana Security, said it is critical to get sales and marketing on the same page when determining what to measure.

"It is imperative that sales and marketing teams have the same objectives and are aligned from the outset-otherwise you will drive a sales and marketing gap," he said.

Sana has quarterly meetings between sales and marketing to make sure objectives are aligned and performance is being measured against agreed-upon metrics, such as defining qualified leads and how many leads to drive each quarter.

"You could have a marketing dashboard, and a marketing dial and do a root cause analysis, and it would all be a complete waste of time if marketing is not aligned at least quarterly with the sales objectives and meeting those objectives," Eades said.